How insurers calculate taxes and fees when your car's totaled
What taxes and fees are pro-rated in a total loss settlement?
- Regional Transit Authority (RTA) tax (www.dol.wa.gov),
- License fee
- Weight-based fee
- Other regional fees (if any)
- Filing fee
How are pro-rated taxes and fees calculated?
Taxes and fees are calculated on a pro-rata basis so the vehicle owner is compensated for the “unused” portion of the annual taxes and fees.
Example: A car’s annual renewal occurred in March. The car is totaled in June. (This means three months of the annual taxes and fees have been used.)
The annual RTA tax is $120 per year. The insurance company owes nine months or 9/12th of the RTA tax.
$120/12 months = $10/month
$10 X 9 months = $90 (the pro-rated fee)
How is salvage value handled when you decide to keep your totaled car?
After the actual cash value, sales tax and applicable pro-rated taxes and fees are added together, the insurance company deducts the salvage value from the total amount.
Actual cash value: $15,375
Sales-tax rate (Seattle 9.8%): $1,506.75
|Example of annual government taxes and fees subject to pro-rating based on the unused portion of the license tab|
|Type of fee||Fee|
|RTA (www.dol.wa.gov) (King, Snohomish and Pierce counties only) must be calculated individually||$20|
|Weight-based fee (varies by vehicle weight)||$10|
|Other regional fees (if any)||$0|
|Example of how the salvage value is handled when you decide to keep your totaled car|
|Total settlement value before deductions, if any||$16,944.75|
|Deductible, if any (collision deductible)||$-500|
|Total payment, if owner keeps car||$16,169.75|